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New York Harbor ethanol moves higher amid weather-related issues

Houston (Platts)--29 Dec 2017 328 pm EST/2028 GMT


The front-month New York Harbor ethanol market remained at a commanding premium to the front-month Chicago ethanol swap Friday as delivery trains headed to the East Coast trading hub were delayed in Pennsylvania.

"The nominations came in heavier than expected for January barges," said one source. "Unit trains got hung up in Pennsylvania but it's a short-term supply issue. It's not an issue where no one has product heading that way, it's just short term."

January New York Harbor barges remained around 10.75 cents above the January Chicago ethanol swap during early trading Friday after they rose to that level Thursday. The barges were 9 cents higher than the swap on Wednesday.

The February barge market did not react as strongly and hovered at an 8-cent premium to the February Chicago ethanol swap.

The tight supply is unlikely to last for long given high production rates and total inventories.

Weekly US Energy Information Administration data released Thursday showed production rose 13,000 b/d to 1.090 million b/d in the week ended December 22. Stocks fell to 22.031 million barrels, but remained 3.348 million barrels higher than the same week last year.

With so much product generally available, the currently high premium for front-month New York Harbor barges will likely fall back to previous levels after the trains arrive.

--Josh Pedrick, joshua.pedrick@spglobal.com

--Edited by Derek Sands, derek.sands@spglobal.com




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